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remain in a JPA for any and all contractual assessments established prior to the City <br />electing to discontinue participation in the PACE program. <br /> <br />Implications for the California HERO Program <br />HERO is available to all residential properties and consent from residential lenders is <br />not required. The California HERO residential loan application informs the loan <br />applicant that the applicant should review the existing loan documents in order to <br />determine whether entering into the California HERO loan would violate the existing <br />loan. For commercial properties, acknowledgement of any existing lender for the <br />property is required in order to obtain a California HERO loan. <br /> <br />Implications for the Figtree PACE Program <br />The FHFA directive does not impact the Figtree PACE Program, which is available to <br />residential properties with no mortgages or with jumbo loans that do not meet FHFA <br />lending criteria. Additionally, multi-family residential properties with five or more units <br />are eligible as these also do not meet FHFA lending criteria. For commercial properties <br />subject to a loan, the Figtree PACE Program requires lender consent. <br /> <br />Although there is some risk associated with residential PACE for the homeowner with a <br />mortgage eligible for or backed by Fannie Mae or Freddie Mac, that risk is mitigated to <br />some degree by the guidelines of the individual JPA PACE programs and by the State’s <br />PACE loss reserve fund. Furthermore, commercial PACE does not pose that same risk. <br />At this point, the potential risks have not proven to be an issue for those communities <br />where PACE programs are in place. <br /> <br />Addressing Potential Liability Concerns <br />Both WRCOG and CEDA will indemnify and hold harmless the City for liability <br />associated with participation in these programs. WRCOG will provide indemnity through <br />its JPA and CEDA requires the related financial institution to provide indemnity to the <br />City. Although the City has already authorized CSCDA’s CaliforniaFirst program to be <br />offered in Redwood City, its program administrator has indicated that it will execute an <br />indemnification and insurance agreement as described above. <br /> <br />ALTERNATIVES <br />City Council could elect not to participate in the two PACE programs or elect to <br />participate in one of the two PACE programs. <br /> <br />FISCAL IMPACT <br />There is no negative fiscal impact to the City’s general fund incurred by consenting to <br />the inclusion of properties within the City limits in the PACE Programs. Although largely <br />turnkey, the PACE programs require some staff resources for public outreach <br />particularly in launching the programs. <br />ENVIRONMENTAL REVIEW <br />Environmental review is not required. The recommended actions do not involve physical <br />change in the environment. <br /> <br />9.B. - Page 5